- EUR/USD holds ground around 1.0620 on the weaker USD.
- Markets anticipate that the Federal Reserve (Fed) is already done with the hiking cycle.
- France, Italy, and Spain's Manufacturing PMIs plummeting and Germany already indicating a severe recession.
- Investors will focus on the Eurozone Unemployment rate and US Nonfarm Payrolls.
The EUR/USD pair rally stalled after reaching 1.0667 but remains above the key support of the 1.0600 mark during the early Asian session on Friday. A fall in US Treasury bond yields and the correction of the US Dollar (USD) lend some support to the pair. The 10-year Treasury yield stands at 4.66%, the lowest level since October 13. Traders will take more cues from the US Nonfarm Payrolls (NFP) report on Friday for fresh impetus. The figures are expected to increase 180,000 jobs in October. The major pair currently trades around 1.0620, losing 0.01% on the day.
Markets anticipate that the Federal Reserve (Fed) is already done with the hiking cycle. Fed Chair Jerome Powell has made it clear that financial conditions will need to remain tight to avoid further rate rises. Powell added that the central bank would take action to bring inflation back to the 2% target, but the policy choices will remain highly data-dependent. According to the CME FedWatch Tool, the probability of a 25 basis-point (bps) rate raise in the December meeting remains low around 20%, putting more pressure on the USD.
On Thursday, the US weekly Initial Jobless Claims rose to the highest level in seven weeks, coming in at 217,000 from 212,000 in the previous reading, higher than the 210,000 estimated. Meanwhile, the Unit Labor Cost for the third quarter dropped by 0.8% from a rise of 2.2% in the previous reading, worse than the expectation.
On the Euro front, HCOB's final Eurozone Manufacturing PMI dropped to 43.1 in October from September’s 43.4, above the first estimation of 43.0. A reading below 50 indicates a contraction in activity. With Manufacturing PMIs in France, Italy, and Spain plummeting and Germany already indicating a severe recession, it is evident that the sector will contract in each of these nations during the current quarter. This, in turn, might cap the Euro’s upside and act as a headwind for the EUR/USD pair.
Looking ahead, market participants will monitor the Eurozone Unemployment rate and the US employment data, including Nonfarm Payrolls and Average Hourly Earnings. Also, the US ISM Services PMI will be due later on Friday. These data could give a clear direction to the EUR/USD pair.
|Today last price
|Today Daily Change
|Today Daily Change %
|Today daily open
|Previous Daily High
|Previous Daily Low
|Previous Weekly High
|Previous Weekly Low
|Previous Monthly High
|Previous Monthly Low
|Daily Fibonacci 38.2%
|Daily Fibonacci 61.8%
|Daily Pivot Point S1
|Daily Pivot Point S2
|Daily Pivot Point S3
|Daily Pivot Point R1
|Daily Pivot Point R2
|Daily Pivot Point R3
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.